Perumal v. Dharmalingam – sllr 1981 volume 1 page 026

In the case between Perumal (plaintiff‑appellant) and Dharmalingam (defendant‑respondent), the court addressed whether section 2 and related provisions of the Companies (Special Provisions) Law, No. 19 of 1974, rendered the partnership operating as “Laxmi Jewelers” illegal from the appointed date, particularly where one partner was a non-national. The court held that the legislative framework did not absolutely prohibit continued business activity post-appointed date but instead subjected entities to the risk of governmental acquisition through vesting orders. This affirmed that the statutory mechanism was designed to enforce restrictions rather than to impose automatic illegality, with penalties limited to vesting of assets rather than nullification of contracts. The decision analyzed the